Lewiston teller. [volume] (Lewiston, North Idaho) 1878-1900, 1887-03-31
THE LEASE,

The Orcgonidh seems to think thu
lease to the Union Pacific practically off
1t says: "Holling thus far the key tc
western terminal business, the o. r. &
N. has acted as illiberally with connect
ing railway lines as it has with producers
within its territory. Out Of sixty-five
cents per 100 pounds, charged on freight
from the east, it takes twenty ght cents
for its own comparatively short mileage.
The Northern will soon be able to cs.
cape this by its line over the mountains
and we have hoped that the Union would
be able to escape it by taking lease Of
the o. r. & N. But consummation Of
this last seems uncertain. Indeed, now
it is hardly to be expected. Probably
the Union concludes that it would be
better to submit to the cyactions of the
o. r. & N. than to take tie lease and
guarantee six per cent. on that company's
stock and bonds, especially since it ap-
pears probable that the 0. r. Il N. will
soon have competition that will reduce its
earning power. Moreover: the Union
cannot but see that the rates of the o.
r. & N. must be reduced, and that the
"inyestment," as it stands on the books,
like that of many other roads, is too big
for the net income it expects and tries to
make. Mr.. Elijah Smith, when asked
to reduce the wheat rate, has invariably
answered that the company was entitled
to an income Of six per cent. on its in.
vestment, and that reduction Of the rate
was incompatible with obtainment OF this
return. This, however, is not a conelu.
sive answer. The cost Of the property
stands on the books of the company at
about $4O,000,000. 1t is certain, how.
ever, that the property could be duplica.
ted now for less than $25, 100000. The
other fifteen millions represent waste and
water. The lines were built at rush,
when material aud labor were at high
Get prices. They were constructed on
the principle that money was no object
whatever. Productivity everywhere was
the rule. In this way millions were
wasted. Again, by purchase Of the prop
erty of the 0. s. N. Go. money was
thrown away. The railway line along
the Columbia river, built as soon as pos.
sible, superseded the old steamboat and
portage line, and thus By the action OF
the purchasers themselves property for
which five million dollars had been paid
was annihilated, or reduced to franchise
and lot Of steamboats, of which the com.
pany had no need. The ''water" in the
stock and bonds also stands for large
sum, but less in fact than in case of most
other roads OF equal extent. But prop.
erty that can be duplicated for twenty
five millions or less cannot expect to
make 6 per cent net return on forty
millions; and it is not just to the coun.
try to attemp: it. Il as an effort, more
over, that will fail, because it requires
rates SO high that the productive power
,f the country cannot advance, and tho
road cannot. therefore, increase the vol
ann of its business. Must then the
fifteen millions be lost This is what
las happened over and over with roads
hat have not been judiciously construc.
ed; it is happening every day in every
lay business. Imprudent expenditure
annot justly insist upon right to re.
roup; it has no right to expect to re- +,
'air its own loss, whether by waste or
Misfortune, at the expense Of the coun- :
~. Much the same principle must be ,
sserted in regard to the Northern and
he Union; it was applied with the rigor :
necessity some years ago to the 0. g.
!, wiping out the stock of the road al.
'gether, and now it is applied also to
'e bonds of the road, wiping out large
art Of them. The Union for years has
cen struggling with its load, and wheth.
it will struggle through or not, may
'pend on the leniency of the govern :
ent. The Northern is loaded up to q = :,
'int which taxes its present resources .
I'd even begins to discount tho future, !
I'd no one eau say as to either of these .
ads what the outcome will be. -
1t is not possible for Mr.. Elijah -,
NTH to enforce permanently his six per =,
Mt. policy en- the forty millions Of the n,
ocks and bonds of The 0. r. a. N, The "
untry cannot stand it, and persistence 50
the effort to make the country stand T
will cut down production throughout 7
e country and make increase of earn. -
g for the road impossible. Upon the .,
rty million basis three per cent. is all n
country can pay; but upon the TWEEN. 81,
five million basis, which would be all e.,
would cost tn dunlieata ~. n,oror.r Il